Both stem cells and progenitor cells are present in umbilical cord blood (UCB) at a high frequency, making these cells a major target population for experimental and clinical studies. As the use of autologous or allogeneic hematopoietic stem cell transplantation in the treatment of various diseases has grown rapidly in recent years, the concept of UCB banking for future use has drawn increasing interest. Stem and progenitor cells derived from UCB offer multiple advantages over adult stem cells, such as their immaturity (which may play a significant role in reducing rejection after transplantation into a mismatched host) and ability to produce large quantities of homogeneous tissue or cells. These cells can also differentiate across tissue lineage boundaries into neural, cardiac, epithelial, hepatic, and dermal tissues. Human UCB provides an alternative cell source that is ethically acceptable and widely supported by the public. This paper summarizes the characteristics of human UCB-derived stem and progenitor cells and their potential therapeutic use for tissue and cell regeneration.